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The recent 25% drop in Fluence Corporation Limited's (ASX:FLC) stock could come as a blow to insiders who purchased US$11.3m worth of stock at an average buy price of US$0.08 over the past 12 months. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only US$9.57m.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Check out our latest analysis for Fluence
Fluence Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Chairman & Strategic Board Advisor Douglas Brown for AU$7.4m worth of shares, at about AU$0.08 per share. That means that even when the share price was higher than AU$0.068 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
While Fluence insiders bought shares during the last year, they didn't sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Fluence is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Does Fluence Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Fluence insiders own about AU$22m worth of shares. That equates to 30% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Fluence Tell Us?
The fact that there have been no Fluence insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. Insiders own shares in Fluence and we see no evidence to suggest they are worried about the future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To help with this, we've discovered 4 warning signs (1 doesn't sit too well with us!) that you ought to be aware of before buying any shares in Fluence.